Less or different work ahead for legal departments when companies can buy rights to use a patent on an exchange

A new financial exchange, called IPXI, will let companies buy, sell and hedge patent rights. On the exchange, companies will be able to buy and sell “unit license rights,” which is a one-time right to use a particular patented technology in a single product. This is explained in the Economist, May 12, 2012 at 72.

What an exchange like this might mean for law departments is that their lawyers will not have to negotiate so many licenses for intellectual property. That is expensive, time-consuming, and uncertain. Likewise, this alternative means to secure a patent right will lessen the need for outside counsel. To purchase a unit license right will therefore reduce demand for legal resources. Cutting against this forecast, however, it may be that companies will lean on their legal teams to monetize more of the company’s patent portfolios.

IPXI was set up in 2008 by Ocean Tomo. It will not be until later this year, however, that the exchange is open for business (See my post of Jan. 16, 2006: Ocean Tomo, patent auctioneer; and March 27, 2009: investor in patents.).